Economic calendar: UK labour market data and corporate earnings

Summary:

• UK wage growth gauges expected to remain unchanged

• Another deterioration in the ZEW index forecasted

• Goldman Sachs and Morgan Stanley among companies reporting earnings today

Investors will be offered some noteworthy readings on Tuesday with the UK labour market report being the most important one. Apart from that, API oil inventory change and the German ZEW index will draw attention. A vast array of the US companies will submit their earnings reports today therefore one should be aware of potential volatility during the US session. Last but not least, the Hungarian central bank will make its interest rate decision at 1:00 pm BST but it is widely anticipated to leave the main rate unchanged at 0.90%.

9:30 am BST - UK, Labour market data for August. The wage growth in the UK has been quite robust in the past year. The gauge excluding bonuses accelerated to 2.9% YoY, the highest since late-2015, while earnings including bonuses were growing at the pace of 2.6% YoY in July. Both gauges are expected to remain at the previous levels and the unemployment rate is also forecasted to reinforce at 4% seen previously. While the data is of course worth to watch it should be noted that it is unlikely that Bank of England will shift monetary policy settings prior to the Brexit date in March next year.

10:00 am BST - Germany, ZEW index for October. The German diffusion index measuring the 6-month economic sentiment did not paint a rosy picture in the past couple of months. The gauge has been pointing to pessimism among the German institutional investors since April this year. However, the past two readings saw improvement. Nevertheless, market consensus expects that such trend will be put on halt in October and the print will show a decline to -12 pts against previous -10.6 pts.

1:15 pm BST - US, Industrial and manufacturing production for September. Retail sales data from the US released yesterday was another weak report from the World’s biggest economy investors were offered lately. Having that in mind some questions may be raised whether the US economy is plateauing or not. Today’s data may offer more hints. Industrial production data is expected to show 0.2% MoM in September (prior reading: 0.4% YoY) and the manufacturing gauge is viewed to remain at 0.2% MoM. The capacity utilization rate is forecasted to tick higher to 78.2% from prior 78.1%.

9:40 pm BST - US, API weekly oil inventories. Tensions between the US and Saudi Arabia concerning the disappearance of journalist Jamal Khashoggi were driving oil market yesterday. The US Secretary of State Mike Pompeo travelled to Saudi Arabia to investigate the matter therefore this topic may remain to be the source of volatility. Nevertheless, it is always good to watch inventory data as it often results in short-term price swings. API estimates released today are expected to show 2.5 mb decline.

Central bank speakers scheduled for today:

• 9:15 pm BST - Fed’s Daly

• 10:20 pm BST - RBA’s Debelle

Major US companies reporting earnings today:

• BlackRock (BLK.US)

• Goldman Sachs (GS.US)

• International Business Machines (IBM.US)

• Johnson & Johnson (JNJ.US)

• Morgan Stanley (MS.US)

• Netflix (NFLX.US)

• UnitedHealth Group (UNH.US)

GBPUSD has been pushing higher this week. GBP traders should remember that the EU summit starts tomorrow and the Brexit is among main topics on the agenda. Having said that, an increased volatility is expected. The resistance zone ranging 1.3260-1.3300 may be a level worth to watch. Source: xStation5